Lessons to be learned: EUROFER on 2030 climate and energy policies framework

The European Commission has published its 2030 framework for climate and energy policies on Wednesday. The Green Paper is a basis for discussion amongst stakeholders. Design of future policies, the document says, should be based on lessons learned from the existing 2020 framework. Stakeholders are invited to state their views on targets and instruments for climate and energy policies past 2020 as well as on competitiveness issues connected with these policies.

EUROFER welcomes the initiative since a reliable long term policy framework is important for investment decisions in the industry. The European Steel Association also applauds the Commission’s readiness to consider the consequences of the on-going economic crisis as well as the effects of steeply rising energy prices on the global competitiveness of European industry. Future climate and energy policy, the Green Paper claims, will also take the availability of technologies for meeting climate targets into account.

At the same time EUROFER criticizes plans to introduce a 40 per cent reduction target for greenhouse gas emissions for 2030 as is mentioned several times in the Green Paper. This would double the current target of 20 per cent until 2020 under the EU Emissions Trading Scheme (ETS). “It is exactly because of a complete lack of economically viable technologies that our sector cannot meet such a target. The Commission should be aware of this since its own Joint Research Center has confirmed this in its recent study on CO2 emissions in the European steel industry” says Gordon Moffat, Director General of EUROFER. A 40 per cent target, Moffat explains, would increase energy cost and add to the burden European industry - and society as a whole - already has to carry.

“What we really need is a target and measures to decrease the gap of average energy prices between the EU and its main competitors,” Moffat adds. The Green Paper acknowledges the price differential as well as significant increases for energy prices in Europe but avoids making a connection to European climate and energy policies. “Soaring costs of climate policies have been a major driver for energy prices in Europe”, Moffat states. “Our industry needs full compensation for indirect costs caused by ever more ambitious emissions targets to stay globally competitive. This is also true for expenses incurred by the promotion of renewables and related grid costs discussed in the Green Paper.”

EUROFER welcomes the Commissions willingness to address future exploitation of shale gas in Europe stated in the Green Paper. Affordable energy is of utmost importance for European industry and therefore all available resources have to be made accessible. “The Green Paper shows that there is growing sensitivity for industry concerns among climate and energy policy makers,” Gordon Moffat concludes. “Lessons drawn from the current framework should include at least one central insight: deindustrialization is a reality in Europe, and current climate and energy policies play a major role in this.”

Represented by EUROFER, the European steel industry is a world leader in its sector with a turnover of EUR 170 billion and direct employment of 360 thousand highly skilled people, producing on average 190 million tonnes of steel per year. More than 500 steel production and processing sites in 23 EU member states provide direct and indirect employment and a living for millions of European citizens.